India's Inflation Uptrend: A Balancing Act for the RBI

India's retail inflation has risen to 0.71% in November, influenced primarily by rising food and fuel prices. Despite remaining below the RBI's inflation target for 10 months, experts predict minor increases ahead. The RBI's recent interest rate cuts align with its strategy amid a 'Goldilocks' economic phase.

India's retail inflation witnessed a marginal increase to 0.71% in November, a rise from the previous month's record low of 0.25%, driven by an uptick in food prices, according to data released by government sources on Friday.

While the Consumer Price Index-based retail inflation remains below the Reserve Bank of India's 4% target for the tenth consecutive month, experts predict this trend could change with increasing costs in key areas such as fuel, vegetables, and spices.

Economists, including ICRA's Aditi Nayar, anticipate that the inflation rate may cross 1.5% in upcoming reports as the RBI navigates fiscal strategies amid a 'Goldilocks' period of the Indian economy characterized by high growth and low inflation expectations.